Our next steps for Alphabet stock after earnings disappoint at nearly every turn
Alphabet whiffed.
TL;DR
- Alphabet's Q3 revenue and adjusted EPS missed consensus estimates.
- Google Cloud revenue doubled year-over-year, exceeding expectations, with segment operating income more than tripling.
- Gemini app reached over 1 billion monthly active users, marking the fastest product growth in company history.
- Search revenue growth decelerated for the second consecutive quarter, with AI mode monetization being a concern.
- Alphabet anticipates significant increases in capital expenditures, with 2027 expected to top $300 billion.
- The company reported negative free cash flow in the third quarter, impacted by capex and a payment for a European Commission fine.
- The stock price is down nearly 30% from its all-time high, with a valuation considered not demanding, though estimates may be updated.